The Australian Prudential Regulation Authority (APRA) has escalated supervisory action against United Super Pty Ltd, trustee of Construction and Building Unions Superannuation Fund (Cbus), by accepting a court enforceable undertaking (CEU) requiring a holistic risk transformation program and by publishing Cbus’ rectification plan to address governance and expenditure-control weaknesses. APRA has also commenced an investigation into potential breaches of the Superannuation Industry (Supervision) Act 1993, focused on expenditure management practices. Cbus has more than 920,000 member accounts and around AUD 100 billion in funds under management. APRA’s recent prudential review identified significant and persistent weaknesses in the trustee’s operational risk management framework, alongside concerns related to insurance administration and outsourcing. Under the CEU, Cbus has committed to engage independent experts to review governance, risk management and insurance administration and to examine root causes, develop an integrated board-approved remediation plan with clear accountabilities incorporating APRA feedback, and appoint an independent reviewer to provide assurance on implementation and sustainability. The CEU allows APRA to seek Federal Court enforcement if undertakings are breached and sits alongside additional licence conditions imposed in August 2024, which remain in force. The rectification plan, published under those licence conditions, responds to recommendations from an independent review into fit and proper assessments and fund expenditure management, commissioned following allegations of serious misconduct within the Construction, Forestry and Maritime Employees Union, a shareholder of United Super. APRA will agree a workable timeframe with Cbus for delivery of sustainable remediation, hold the trustee to implementation of the rectification plan, and pursue supervisory or enforcement responses where warranted while the SIS Act investigation proceeds.

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